Google’s plan to acquire Israeli cybersecurity firm Wiz for $23 billion has fallen through, marking what could have been its largest takeover. Wiz CEO Assaf Rappaport announced the decision to reject the offer, emphasizing the company’s goal to grow towards $1 billion in annual revenue and prepare for an initial public offering.
This acquisition was seen as a way to enhance Google’s cybersecurity capabilities, especially in light of a significant outage caused by CrowdStrike, a leading cybersecurity firm, recently impacting the industry. According to Wedbush analyst Dan Ives, the deal collapsed due to investor concerns and ongoing antitrust issues, as Google has faced heightened scrutiny from regulators, recently concluding one of its major legal trials with the Department of Justice.
Ives noted that the failed acquisition could have widespread consequences across the tech sector. He anticipates that Google will likely intensify its efforts to expand its cybersecurity initiatives, a strategy that Microsoft is expected to adopt as well.
Ives pointed out that there is a pressing need for consolidation in the cybersecurity market. Following a global IT outage caused by a faulty update from CrowdStrike, Microsoft has been under scrutiny as users faced disruptions, including infamous “blue screens of death.” While Ives maintains that CrowdStrike remains a top choice for cybersecurity, he suggests that Microsoft may need to enhance its cybersecurity offerings further, particularly now that the opportunity for Google to acquire Wiz has passed.